This interview is part of our new Blockchain In Real Estate series, where we interview the world's leading thought leaders on the front lines of the intersections between blockchain and real estate.
In this interview we speak with John Kang, CEO and co-founder of Reasi, to understand how his company is using blockchain to transform the real estate business, and what the future of the industry holds.
1. What’s the story behind Reasi. Why and how did you begin?
JK: Since my college days, I’ve been interested in leveraging real estate to help the masses build net worth. There are so many awesome characteristics about real estate. Real estate has preferential tax treatment, is a highly-leveraged but manageable business by anyone, and appreciates as it gets older. However, it’s still largely inaccessible and transaction fees contribute heavily – which is where I can do some good.
I’m a software engineer and during the 2000s, I spent 3-4 years as a loan officer. Having that coding mindset, I identified that the home transaction badly needed a digital backbone, or escrow. There is just too much data leakage between multiple parties and systems, which in turn creates a ripe environment for wire fraud. The lack of infrastructure also fosters inefficiency, which translates into higher costs. That’s why we created Reasi – to bring convenience, efficiency, and security to real estate transactions.
2. Please describe your use case and how Reasi uses blockchain :
JK: Reasi uses smart contracts to be the digital checklist for real estate transactions. At its core, a smart contract is escrow – they are synonymous. If conditions are met, then release the funds and the deed to the respective parties. It was natural for Reasi to build our business on blockchain technology for property closings. We’ve already streamlined much of the transaction using a combination of traditional and blockchain tech. Soon, this smart contract will be capable enough to guide simple P2P transactions without intervention. We currently don’t use cryptocurrency, but that is an option we can implement when the time is right.
3. Could you share a specific customer/user that benefits from what you offer? What has your service done for them?
JK: We’ve launched in the vacant land niche, and our land investor customers relish the lower cost-of-service. While they love the transparency into their deals, the financial savings brought them to our doorsteps. It’s also a truly digital transaction – they e-sign documents, deposit funds, and get real-time tracking. The blockchain element offers a layer of security, but it does create some friction in the onboarding, which isn’t necessarily a bad thing. When customers transact in large amounts (as they do on Reasi), I sleep better at night knowing hackers will have an extremely difficult time on our platform.
4. What other blockchain use cases in real estate are you excited about?
JK: I am super-excited about blockchain + mortgages. Mortgages really need to be completely digital – blockchain is the ideal technology from both efficiency and liquidity perspectives. Like escrow, there is so much inefficiency and risk in the loan origination process that can be solved with streamlining the workflow with automation. But blockchain specifically brings chain-of-ownership clarity, a problem that has burdened this industry for a decade. Fractionalization also helps solve securitization inefficiencies, further democratizing the opportunity to invest in mortgage debt.
5. Where will Reasi be in 5 years?
JK: Reasi will house a buying and selling experience for real estate that is as convenient as buying or selling a collectible on eBay. We may have match-making features for buyers or sellers, but our priority is having the most seamless transaction experience for our end customers. By then, identity verification, payment integration, title commitments, and mortgage financing should be mostly instantaneous.
As our world gets smaller, Reasi will also be replicating our success in other countries and adjacent industries.